Banks could "learn a thing or two about fair play" from the Olympics, according to the governor of the Bank of England, who claimed that the Games' impact on confidence could boost the economy.
Sir Mervyn King said that there were lessons for the British economy from the success of the Olympics including that an objective worth attaining, "like a gold medal, requires years of hard work". "Success does not come overnight.
That is as true of our economy as it is of sport," he said. Writing in the Mail on Sunday, the governor added that the banking system must be reformed so that ot focuses less on making money in the short term and more on building businesses to serve their customer's interests over the longer term.
"Yes, for many years, our financial sector sustained the illusion that it was possible to become a millionaire overnight by buying and selling pieces of paper. But we have seen how paper fortunes in financial markets can disappear overnight," said Sir Mervyn.
"Things need to change. The Government’s plans to build a wall between banks’ risky trading on one side, and their lending to businesses and families on the other, will help. As will the injection of new competition into our banking system."
He added that "as recent scandals have shown, banks could learn a thing or two about fair play from the Olympic movement".
Over the last couple of months, the banking sector has been rocked by the Libor-rigging scandal that saw Barclays hit with a £290m fine.
Other lessons that could be learnt from the Olympics, according to the Governor, were that "motivation does not come from financial incentives alone".
"The financial sector has done us all a disservice in promoting the belief that massive financial compensation is necessary to motivate individuals," said Sir Mervyn, who highlighted the success of the Olympics volunteers.
He stressed the need for competitive team sports in schools, adding that "the importance of trusting others in order to find success, how to cope with victory and defeat, are all preparation for the world of work".
Last week, the prime minister revealed plans to ensure every child at primary school will have to take part in competitive team sports after it emerged that almost 2,000 primary schools do not offer competitive sport.
The Daily Telegraph has launched the Keep the Flame Alive campaign to revive competitive sport in schools and encourage people to volunteer at sports clubs.
Sir Mervyn said that the Olympics had "spread good cheer" and that the impact on confidence "may give the economy a boost".
Although he stressed that the Games could not alter the "underlying economic situation we face", he added that the "conditions were in place for a recovery" and "the Bank of England is, and will carry on, doing all we can to help bring it about".
Last week, the central bank slashed its growth forecasts, saying that growth in two years' time was likely to be around 2pc a year, down sharply from the forecast of 2.67pc just three months ago.
telegraph.co.uk
Sir Mervyn King said that there were lessons for the British economy from the success of the Olympics including that an objective worth attaining, "like a gold medal, requires years of hard work". "Success does not come overnight.
That is as true of our economy as it is of sport," he said. Writing in the Mail on Sunday, the governor added that the banking system must be reformed so that ot focuses less on making money in the short term and more on building businesses to serve their customer's interests over the longer term.
"Yes, for many years, our financial sector sustained the illusion that it was possible to become a millionaire overnight by buying and selling pieces of paper. But we have seen how paper fortunes in financial markets can disappear overnight," said Sir Mervyn.
"Things need to change. The Government’s plans to build a wall between banks’ risky trading on one side, and their lending to businesses and families on the other, will help. As will the injection of new competition into our banking system."
He added that "as recent scandals have shown, banks could learn a thing or two about fair play from the Olympic movement".
Over the last couple of months, the banking sector has been rocked by the Libor-rigging scandal that saw Barclays hit with a £290m fine.
Other lessons that could be learnt from the Olympics, according to the Governor, were that "motivation does not come from financial incentives alone".
"The financial sector has done us all a disservice in promoting the belief that massive financial compensation is necessary to motivate individuals," said Sir Mervyn, who highlighted the success of the Olympics volunteers.
He stressed the need for competitive team sports in schools, adding that "the importance of trusting others in order to find success, how to cope with victory and defeat, are all preparation for the world of work".
Last week, the prime minister revealed plans to ensure every child at primary school will have to take part in competitive team sports after it emerged that almost 2,000 primary schools do not offer competitive sport.
The Daily Telegraph has launched the Keep the Flame Alive campaign to revive competitive sport in schools and encourage people to volunteer at sports clubs.
Sir Mervyn said that the Olympics had "spread good cheer" and that the impact on confidence "may give the economy a boost".
Although he stressed that the Games could not alter the "underlying economic situation we face", he added that the "conditions were in place for a recovery" and "the Bank of England is, and will carry on, doing all we can to help bring it about".
Last week, the central bank slashed its growth forecasts, saying that growth in two years' time was likely to be around 2pc a year, down sharply from the forecast of 2.67pc just three months ago.
telegraph.co.uk
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